Industrial Alliance announces closing of its offering of common shares and the redemption of 8.25% subordinated debentures

/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES/

QUEBEC CITY, Feb. 27, 2013 /CNW Telbec/ - Industrial Alliance Insurance
and Financial Services Inc. ("Industrial Alliance" or the "Company")
today announces that it has closed its previously announced bought deal
public offering of common shares (the "Common Shares") at a price of
$37.50 per Common Share purchased by a syndicate of underwriters co-led
by National Bank Financial Inc. and BMO Capital Markets. The offering
results in a total of 6,330,000 Common Shares being issued today by
Industrial Alliance for gross proceeds of $237,375,000. The 6,330,000
Common Shares include 330,000 Common Shares which were issued pursuant
to the partial exercise of the over-allotment option by the
underwriters. The net proceeds of this offering will be used to redeem
all of the outstanding 8.25% subordinated debentures due March 27, 2019
(the "Subordinated Debentures") with a nominal value of $100 million
and to redeem all of the Industrial Alliance Trust Securities - Series
A (IATS) with a nominal value of $150 million.

The Common Shares were issued under a prospectus supplement dated
February 20, 2013 to the short form base shelf prospectus of Industrial
Alliance dated April 29, 2011. Details of the offering are set out in
the prospectus supplement available on SEDAR at www.sedar.com.

Industrial Alliance also announces that it has exercised today its right
to redeem the Subordinated Debentures in accordance with the terms of
the trust indenture dated March 27, 2009 governing the Subordinated
Debentures. The redemption of the Subordinated Debentures will be
effective on April 1, 2013 (the "Redemption Date"). Upon redemption,
Industrial Alliance will pay to the holders of Subordinated Debentures
a redemption price equal to $1,053.71 per $1,000 principal amount of
Subordinated Debentures, plus all accrued and unpaid interest thereon
up to but excluding the Redemption Date, for a total of $1,054.84 per
$1,000 principal amount of Subordinated Debentures, less any taxes
required to be withheld or deducted. The aggregate principal amount of
Subordinated Debentures currently outstanding is $100 million.

Notice
The Common Shares offered have not been and will not be registered under
the United States Securities Act of 1933, as amended (the "U.S.
Securities Act") or the securities laws of any state of the United
States of America, and may not be offered, sold or delivered, directly
or indirectly, within the United States, its territories, its
possessions and other areas subject to its jurisdiction or to, or for
the account or benefit of, U.S. persons (as defined in Regulation S
under the U.S. Securities Act), except in certain transactions exempt
from, or not subject to, the registration requirements of the
U.S. Securities Act and applicable state securities laws. This press
release does not constitute an offer to sell or a solicitation of an
offer to buy any of these Common Shares within the United States.

Forward-looking Statements
This press release may contain statements relating to strategies used by
Industrial Alliance or statements that are predictive in nature, that
depend upon or refer to future events or conditions, or that include
words such as "may", "will", "could", "should", "would", "suspect",
"expect", "anticipate", "intend", "plan", "believe", "estimate", and
"continue" (or the negative thereof), as well as words such as
"objective" or "goal" or other similar words or expressions. Such
statements constitute forward-looking statements within the meaning of
securities laws. Forward-looking statements include, but are not
limited to, the Company's expectations regarding the redemption of
securities described in this press release and information concerning
the Company's possible or assumed future operating results. These
statements are not historical facts; they represent only the Company's
expectations, estimates and projections regarding future events.

Although Industrial Alliance believes that the expectations reflected in
such forward-looking statements are reasonable, such statements involve
risks and uncertainties, and undue reliance should not be placed on
such statements. Certain material factors or assumptions are applied in
making forward-looking statements, and actual results may differ
materially from those expressed or implied in such statements. Factors
that could cause actual results to differ materially from expectations
include, but are not limited to: Industrial Alliance's current and
expected future capital position, general business and economic
conditions; level of competition and consolidation; changes in laws and
regulations including tax laws; liquidity of Industrial Alliance
including the availability of financing to meet existing financial
commitments on their expected maturity dates when required; accuracy of
information received from counterparties and the ability of
counterparties to meet their obligations; accuracy of accounting
policies and actuarial methods used by Industrial Alliance; insurance
risks including mortality, morbidity, longevity and policyholder
behaviour including the occurrence of natural or man-made disasters,
pandemic diseases and acts of terrorism.

Additional information about the material factors that could cause
actual results to differ materially from expectations and about
material factors or assumptions applied in making forward-looking
statements may be found in the "Risk Management" section of the 2012
Management's Discussion and Analysis and in the "Management of Risks
Associated with Financial Instruments" note to Industrial Alliance's
consolidated financial statements, and elsewhere in Industrial
Alliance's filings with Canadian securities regulators, which are
available for review at www.sedar.com.

The forward-looking statements in this news release reflect the
Company's expectations as of the date of this document. Industrial
Alliance does not undertake to update or release any revisions to these
forward-looking statements to reflect events or circumstances after the
date of this document or to reflect the occurrence of unanticipated
events, except as required by law.

About Industrial Alliance
Founded in 1892, Industrial Alliance Insurance and Financial Services
Inc. is a life and health insurance company with operations in all
regions of Canada as well as in the United States. The Company offers a
wide range of life and health insurance products, savings and
retirement plans, RRSPs, mutual and segregated funds, securities, auto
and home insurance, mortgage loans and other financial products and
services for both individuals and groups. The fourth largest life and
health insurance company in Canada, Industrial Alliance contributes to
the financial wellbeing of over three million Canadians, employs 4,300
people and manages and administers more than $83 billion in assets.
Industrial Alliance stock is listed on the Toronto Stock Exchange under
the ticker symbol IAG.